NU Online News Service, July 21, 2:16 p.m.EDT

Business has picked up in the bidding for Transatlantic Holdingssince the New York-based reinsurer and Allied World Assurancecalled off their proposed merger, as Transatlantic says it hasentered into two confidentiality agreements: one with ValidusHoldings and one with an undisclosed third party.

Validus had been pursuing a hostile bid for Transatlantic afterthe company refused to agree to a confidentiality agreement thatcontained a “standstill provision” as a condition for discussions between the companies. The provisionwould have effectively stopped Validus from pursuing its bidwithout approval from the Transatlantic board, Validus CEO EdNoonan had said.

Transatlantic says the confidentiality agreement agreed upon bythe two companies on Friday contains a “limited standstill” thatexpires Oct. 31. Validus adds that it has agreed “not to take orenter into an agreement with any third party regarding certainactions, including acquiring any additional shares of Transatlanticcommon stock, mailing a consent solicitation statement toTransatlantic stockholders or collecting consent cards with respectto Validus' previously announced consent solicitation to remove andreplace the current Transatlantic board of directors or seeking tocall a special meeting of Transatlantic's stockholders pursuant toTransatlantic's by-laws.”

The two companies have also agreed to take no action on theirlawsuits against each other in the Chancery Court of Delaware and United States District Court for the State of Delaware duringthe period ending Oct. 31.

Regarding the undisclosed third party, Transatlantic says todayit has “commenced discussions with a third party regardingpotential strategic alternatives.” Transatlantic further statesthat it will not comment further unless it is required by law orNYSE regulations.

The agreement with the undisclosed party is in addition to theconfidentiality agreements reached with Validus and Berkshire Hathaway's National Indemnity Company.